Minnesota's child care crisis is government-made

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Access to high-quality affordable child care is fundamental to a well-functioning economy. It also enables parents to stay in the workforce, which allows businesses to find workers. And high-quality child care also readies children for school.

Unfortunately, the child care system in Minnesota has been broken for a long time. Middle-income and low-income parents are being squeezed by sky-high prices as they try to afford child care — that is, if they do not exit the workforce altogether. And when parents cannot work, businesses cannot find workers, which is a loss to our economy.

According to Child Care Aware, in 2019, parents in Minnesota spent over $16,000 a year to send their infant to child care. Families with two kids — one infant and one 4-year-old — paid more than $28,000 to keep both kids in a child care center for the whole year. Estimates from Economic Policy Institute shows that sending an infant to child care in Minnesota costs more than tuition at a four-year college, as well as rent.

Minnesota fares even worse when compared with other states. In 2019, only parents in four other states and Washington, D.C., paid more money to send their infant to a child care center, making Minnesota the sixth-most expensive for center-based infant care. And after controlling for income levels, Minnesota was the fourth most expensive. No wonder tens of thousands of Minnesota parents quit work, chose not to take a job or change jobs due to child care issues.

Clearly, something should be done about these high prices. But what that something is depends on what is causing prices to be so high.

A lot of lawmakers would have you believe that the only way that the state of Minnesota can address the child care crisis is by spending more money on early childhood. But the child care crisis, much like a lot of our woes, appears to be government-made.

Minnesota, for example, requires teachers at child care centers to look after a smaller number of children compared with other states. Additionally, our state also requires child care center teachers to have more education and longer training experience compared with other states. All these rules do not come at zero cost. When teachers must look at a smaller number of children, the cost of providing care per number of kids goes up. Likewise, when centers must hire highly educated teachers, they have to offer them high wages. All these costs are passed on to parents.

Currently, Minnesota rules require that for every four infants present at a licensed child care center facility, there must be one caregiver. In a newly published report, the Center of the American Experiment estimates that if this rule was changed to allow centers to place five infants per one caregiver instead of four, parents would pay $2,800 less per year to send their infant to a child care center. And if the state stopped requiring child care center teachers to have a high school diploma and college credits, child care for infants would be $3,800 less expensive.

Minnesota's child care crisis is government-made. And no amount of money will bring costs down if no action is taken to deal with these burdensome rules.

Martha Njolomole is an economist at Center of the American Experiment and author of the report "Childcare Crisis: Regulation and the High Cost of Childcare in Minnesota."